Property sales to foreign investors fall by 76% in Cyprus

The number of properties sold in Cyprus has declined dramatically so far in 2009 especially to foreign buyers, the latest statistics show.

Sales of real estate to foreigners have gone down an astonishing 76%, the figures from the Land Registry show. Sales to Cypriots are also down by 28% in the first ten months of this year. Overall all sales are down by 52% compared with last year.

Only 1,480 properties on the Mediterranean islands were sold to non Cypriots in 2009 compared with 6,118 during the first ten months of 2008. In October there were just 117 properties sold to foreigners across the whole island.

There is concern that traditional buyers such as the British, who make up around 50% of foreign buyers, have been put off by publicity about the title deed scandal which has left an estimated 130,000 investors without legal documents proving that they own their properties.

They have little confidence in the off-plan deals being offered by property developers and are coming to believe that the Cyprus government has neither the will nor the ability to resolve the long-standing Title Deed issues.

Criticism is mounting that the government is not doing enough. Cyprus lawyers are the latest group to condemn proposals from the government aimed at sorting it out. It claims that proposed amendments for three categories of title deeds will just create more bureaucracy and delays.

‘It will lead us into a labyrinth without solving the problem,’ it said in a statement and called for the Land Registry to be the main body for issuing title deeds as soon as a property is ready.

And campaigners point out that the main cause of the problem, developers taking out mortgages on properties they have already sold, is not addressed. ‘The proposed legislation seriously undermines the rights of buyers. In effect it is merely an amnesty for developers who have failed to adhere to planning/building permits issued or even built illegally without these permits,’ the Cyprus Property Action Group said in a statement.

The Cyprus Property and Landowners Association said it agrees that the amendments do not address the root of the problem but it praised the government for trying to sort out the mess. ‘The government is trying to do something about a huge problem. The positive thing is that they acknowledge that the problem is there. It’s criminal that successive governments have let the problem reach this point,’ it said.